Number I | September 2016 Number VI | May 2017 More articles available at: www.kemlu.go.id/chicago

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U.S. Vice President Mike Pence Visits EDITOR’S NOTE Dear Readers, The charm of is never ending. Trip Advisor has chosen Bali as the best tourism destination in the world in 2017. Thanks to its traditional values which combine with modern life that has become a great attraction for tourist from all over the globe.

The U.S.A. is one of the top five foreign investments by country in the first quarter of 2017, ranked fourth with US$587.4 million investment between January and March.

Indonesia's agriculture products such as mangosteen, bananas, star fruit, snake-fruit, , round , cabbage, cauliflower, and flowers have been exported to 29 countries. Nevertheless, Indonesia is still seeking the opportunities to market its products to U.S.A. through a partnership.

Photo: US Vice President Mike Pence listens to Indonesian President Joko Widodo at Merdeka U.S. Vice President Mike Pence Visits Palace in on April 20 (http://www.cnn.com/2017/04/22/opinions/us-indonesia-pence-ties/) Indonesia 1

Sri Mulyani: Asia’s Best Finance Minister 2 U.S. Vice President, Mike Pence visited The visit has resulted in signing 11 Indonesia on April 19 – 21 as part of his 10- commercial and investment agreements Indonesia Foreign Minister visit the US to Strengthen Strategic Partnership 2 day visit to Asia. between U.S. and Indonesian companies Trip Advisor: Bali, Indonesia – that amounted to USD 10 billion over time. His visits consist of meetings such as One of the top 25 Destinations in the World 3 meeting with the President of Indonesia, BKPM: The US Makes the List of Top-5 The deals include Lockheed Martin Joko Widodo and Vice President Jusuf Kalla, Foreign Investment by Country 4 providing an advanced weapons targeting as well as celebrating the 50th anniversary Indonesia – U.S. Trade Overview 4 system for Indonesia's F-16 fighter jets, of the Association of Southeast Asian Indonesian Tropical Fruits to ExxonMobil selling 1 million tons of liquid Nation (ASEAN) and the 40th anniversary of World Markets 5 natural gas to state-owned oil and gas US ties with the group. Indonesia's Horticultural Products – company for 20 years starting in a Great Demand in Many Countries 6 During his visit to Jakarta, the country's 2025, Honeywell supplying turboprop Domestic Production, Export, and capital, Pence declared "As the largest engines to company Consumption of Indonesian Coffee 7 majority Muslim country, Indonesia's Dirgantara, and a USD 2 billion electricity Indonesia Organic Products 10 tradition of moderate Islam, frankly, is an metering system organized by a inspiration to the world," Pence declared. consortium of companies. For more detail information please contact: Economics Affairs - Consulate General He added that the United States commends of the Republic of Indonesia Indonesia and its people "for the great 211 W. Wacker Drive #8 inspiration that Indonesia provides to the Chicago, Illinois 60606 Phone: 312.920.1880 world." Fax: 312.920.1881 Email: [email protected] Website: www.kemlu.go.id/Chicago

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Sri Mulyani: Asia’s Best Finance Indonesia Foreign Minister Minister Visits the United States to Strengthen Strategic Partnership

Photo: Retno Marsudi, Indonesia Foreign Minister meets with US Vice President, Mike Pence in Photo: Sri Mulyani, Indonesia Finance Minister (http://thejak.co) Washington, D.C. (www.kemlu.go.id) According to Finance Asia’s, Sri Mulyani he left to head the National Development The Indonesia Foreign Minister visited Indrawati is a worthy winner of 2017 Planning Agency (Bappenas). Washington, D.C. on 4-5 May 2017. The Finance Asia’s Finance Minister of the purpose of her visit is to follow up on US Year award. Sri Mulyani Indrawati was Bambang jump-started the national tax Vice President Visit to Jakarta last month appointed as Indonesia’s Finance Minister amnesty program, but Finance Asia said as well as to strengthen Indonesia – US last July, returning to a job she held that Sri's "fearsome reputation" was Strategic Partnership through mutually between 2005 and 2010. "undoubtedly crucial" to its continued beneficial cooperation for the people of success. Indonesia's tax amnesty has both countries. Sri Mulyani emphasized improving the been lauded as one of the most efficiency of tax collection, a crucial step successful programs of its kind, with The Minister visits consist of meetings for Indonesian Government in order to participants declaring Rp 4,590 trillion with Secretary of State, Rex Tillerson, Speaker of the House, Paul Ryan, and the get its wealthiest citizens to declare their ($344 billion) worth of assets previously Assistant to the President for Homeland assets. hidden from government oversight. Security and Counterterrorism, Thomas P. Bossert. The Hong Kong-based financial journal, in The early take-up of the tax amnesty was its article explained why Sri Mulyani was far lower than the administration had The issues that were raised during the their top pick. They have noted that she sought after. meetings include mutually beneficial has been particularly successful in economic cooperation, common efforts in countering terrorism and radicalism improving the Indonesian government’s Minister Indrawati has also pushed for through soft power, cooperation in revenue streams, which had failed to hit cuts in spending, slashing government maintaining stability and peace in the the mark for the last seven years. expenditure by 3% last year. This two- region as well as resolving the Palestine- pronged approach is economics 101 in Israel Conflict. This success also came along with the balancing the budget. However, it is a implementation of tax amnesty program rarity in a region where tax collection that had been launched before Minister often disappoints, and governments Indrawati started the job where in July often overspend. last year, Sri Mulyani accepted the position to head the Finance Ministry (continue page 3) under President Joko "Jokowi" Widodo, succeeding Bambang Brodjonegoro after 2 Trade & Investment Bulletin| Number VI / May 2017

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Indonesia achieved a dramatic narrowing consumption improving and (Source: Finance Asia) of its current account deficit in the last infrastructure investment is on the rise. quarter of 2016 with household

Trip Advisor: Bali, Indonesia - One of the top 25 Destinations in the World

According to Trip Advisor – 2017 Also known as the Land of the Gods, Bali disco music. For a quieter evening enjoy Travelers’ Choice, Bali in Indonesia appeals through its sheer natural beauty the beach at Jimbaran, a popular spot to ranked the first spot among other 24 of looming volcanoes and lush terraced eat fresh barbecued seafood. Sanur cities in the world, including locations rice fields that exude peace and serenity. Beach also dotted with hotels and throughout Asia, Northern Africa, The UK, Bali enchants with its dramatic dances restaurants. You can also visit Nusa Dua, USA, Latin America, and Australia. and colorful ceremonies, its arts, and where more private beaches are located crafts, to its luxurious beach resorts and front at the luxurious hotels. Before Hollywood caught on (aka Eat Pray exciting nightlife. And everywhere you Love) to the charm of Bali, travelers have will find intricately carved temples. Surfers love the waves at Nusa been flocking from near and far to Lembongan near Nusa Penida. These experience the fantastic organic foods, Bali’s white beaches are one of the islands are a 45 minutes boat trip spiritual experience and colorful sunsets favorite places to go for family holidays. from Nusa Dua or from Sanur. At Nusa on offer. But perhaps no place is as There are a variety of water sports Penida’s southwestern coast are the serene and surreal as Ubud, lying in the available, such as banana boats, Manta Point and the Malibu point where center of Bali with its’ pristine rice fields, parasailing or jet skiing, swimming or divers can swim with Trevally, big rays, rolling hills, and friendly locals. It is the plain sunbathing. Most well known and even sharks. The best dive spots are best destination to surf, bike and for a among Bali’s beaches is Kuta. Along with at Menjangan with its reef flat, anchor yoga retreat. this stretch of Kuta are an array of hotels, wreck, eel garden and caves to explore. restaurants, shops and cafes. In the evenings the area throbs to the beat of (Source: www.indonesia.travel)

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BKPM: The US Makes the List of Top Five Foreign Investment by Country The Investment Coordinating Board puts China in the third place, behind investment will continue to increase,” he (BKPM) reports that the United States has Singapore (US$2.1 billion) and Japan said. made it into top five foreign investments (US$1.4 billion). Data from the BKPM show that Indonesia by country in the first quarter of 2017. The former trade minister said that experienced Rp165.8 trillion investments US ranked fourth with US$587.4 million Chinese investment in Indonesia continues in the first quarter of 2017 or 24.4 percent investment between January and March. to grow above average in recent years of the full-year target of Rp678.8 trillion. compared to other countries. “US investment is substantial. I hope the The figure was a 13.2 increase compared US can continue to at least be in the top “China is already the world’s second- to the same period last year at 146.5 7,” the BKPM chairman Thomas Lembong largest economy and Asia’s number one. trillion and created 194,000 new jobs. said yesterday in Jakarta. So, it would be natural if it becomes Domestic investment realization reached number one in Indonesia,” he said. Lembong underlines Indonesia’s economic Rp68.8 trillion, a 36.4 percent increase ties with the US, which was reflected in the Thomas even said that Chinese investment compared to the same period last year. US Vice President Mike Pence’s visit to in Indonesia is smaller than its investment Meanwhile, foreign investment realization Jakarta last week. in the neighboring countries. stood at Rp97 trillion, a 0.94 percent increase compared to last year. Thomas also stressed the importance of “We lag behind the neighboring countries. Chinese investment that reached US$599.6 I believe the trend is apparent, Chinese (Source: Tempo.co) in the first quarter this year. The figure Indonesia – U.S. Trade Overview

Photo: fas.usda.gov Indonesia is the most populous Southeast During the global financial crisis, Indonesia Indonesia's government ratings to positive Asian nation and is the largest market in outperformed its regional neighbors and from stable. the region for U.S. agricultural exports, joined China and as the only G20 President Joko Widodo - elected in July which totaled $2.7 billion in 2016. members posting growth. 2014 – develops Indonesia’s maritime Indonesia ranks as the United States' resources and pursues other infrastructure ninth-largest market worldwide, with top Indonesia’s annual budget deficit is capped development, including significantly U.S. agricultural exports including at 3% of GDP, and the Government of increasing its electrical power generation soybeans, cotton, feeds and fodder, Indonesia lowered its debt-to-GDP ratio capacity. Fuel subsidies were significantly wheat, and dairy products. from a peak of 100% shortly after the reduced in early 2015, a move which has Asian financial crisis in 1999 to less than helped the government redirect its While bilateral trade continues to grow, 25% today. spending to development priorities. Indonesia has increasingly adopted trade restrictive measures in an attempt to fulfill Moody's Investors Service on February (Source: fas.usda.gov; Indexmundi.com; food self-sufficiency goals. 8th, 2017 revised the outlook on cia.gov)

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Indonesian Tropical Fruits to World Markets “Equipped with more than almost 30 years of industry know-how and the latest technology, Fruit-ING is set to manufacture high- quality tropical fruit pulps and juices US, European and Japanese standards. We are experienced in Tailor-Made fruit products as well as Standard pulps and juices, all of which are 100% natural and made from the freshest produce possible.”

As a country that is crossed by the passion fruit, pineapple, rambutan, snake Those sorts of fruits are typical and only equator, Indonesia is a suitable place for fruit, soursop, tamarind, and watermelon. growing in tropical lands. He believes that the plantation of many types of tropical with this uniqueness, Indonesia can The Managing Director Iwan Winardi fruits. The varieties include snake fruits, compete with other tropical countries shared his views on business development rambutan, banana, and much more, which selling similar products. opportunities of the Indonesian tropical are certainly difficult to be found in non- fruit product. His understanding of Key to Access World Markets tropical countries. Indonesian local fruits Indonesia’s abundant agriculture and “I collect the fruits from all around our are not only delicious to eat but also rich plantation including fruits with diverse environment as an export commodity," in . variants and nutrition led him to become a said Iwan. However, not all fruits from

businessman. farmers are acceptable for export. The Fruit ING, a processed fruit company company implements tight standards that located in Gresik, East Java, is a company The ability to manage his time and control ensure selecting only high-quality fruit for that produces fruit pulps and juices as the profit is the advantages which encourage export. superior products export to the United his passion of being a business man. To gain high-quality products which meet States and several Asian countries, Japan "Indonesia has many kinds of potential the market demand in the U.S. and and South Korea. export fruits, such as mangoes, guavas, Europe, FruitING also implements strict

soursop, s procedures on the fruit selection and Some of its popular fruit pulps products trawberries, bananas, pineapples, and packaging process. The company selects are made of acerola, cantaloupe, coconut, much more,” he said. non-synthetic pesticides and non- gac-fruit, honeydew melon, jackfruit, synthetic fertilizers for fruits from its , mangosteen, noni, papaya, trusted farmers. The contract is made

Number VI / May 2017 | Trade & Investment Bulletin 5 between Fruit ING and the farmers to and need, Fruit ING uses Tetra Pack processing and packaging of food and ensure the quality of fruits. machine for the food and beverage beverages. "The quality of the products packaging process. It is the key (to access produced by the machine has been tested In addition to the fruit selection phase, the their markets)," said Iwan. and trusted by the market, especially the company is also paying attention the main markets in America and Europe," production process to ensure the products Imported from Sweden, the packaging said Iwan. are receivable on the targeted markets. To system combines the process of aseptic meet the export standard, Fruit ING uses with UHT that allows products to survive (Source: Indonesia Invites) production machines from Europe. “To without refrigeration for up to one year. It meet their (developed countries) demand also provides quality assurance for the

Indonesia's Horticultural Products - A Great Demand in Many Countries

Indonesia has a number of superior horticultural products such as mangosteen, star fruit, snake fruit and rambutan.

Good quality products have been exported regularly to other countries, such as mangosteen which in 2016 was exported to 29 countries on a regular basis.

In 2016, Indonesian vegetables such as cabbage and cauliflower with the amount up to 40,240 tons and about 77 kinds of other vegetables were exported to Taiwan, , Singapore, and the Netherland. Those commodities Besides fruits and vegetables, Indonesian The export of vegetables such as bring the economic value and trust from horticultural products in particular cabbage, beans, and watercress reached the consumers in the destination country. frangipani flower, jasmine, and 132.878 tons.

chrysanthemum are also experienced Similarly, the export of Indonesian fruits high demand from Korea, Malaysia, While the export of coconut, such as coconut, mangosteen, and Vietnam and several other countries. The mangosteen, and banana reached bananas and 176 other types of fruit export to those countries reached 4,982 173,865 tons periodically and has been reached 564,372 tons and have a high tons. exported to Thailand, Malaysia, China and demand from world consumer. 20 other countries. Indonesian coconut has been exported Based on the export data in 2017 routinely to China, Thailand, Japan and 16 (January to March), the Indonesian Meanwhile, the export of jasmine and other countries. Meanwhile, Japan, horticultural product remains in high frangipani flowers to Cambodia, Vietnam, China, and Malaysia rank as the 3rd demand in their recipient countries. Thailand, China, and Singapore reached largest importer of bananas from 1,067 tons. Indonesia.

(Source: Pertanian.go.id)

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Domestic Production, Export, and Consumption of Indonesian Coffee Indonesia is the world's top coffee Indonesia coffee export to the US grew by The current chairwoman, Ibu Rahmah, producing and exporting countries. Most 37.9% in the period of 2014-2016, founded the cooperative in 2008 and has of the production constitutes the Robusta reaching USD 25.48 million in 2016. also operated and managed her family's type. Indonesia is also famous for having coffee business for 20 years - purchasing One successful story of a small-scale a number of specialty coffees such as cherries, processing the green coffee and grower is the KOPEPI Ketiara Cooperative. 'Kopi Luwak' (known as the world most selling to local traders. The commitment Located in the Gayo Highlands of expensive coffee) and 'Kopi Mandailing'. of the coop's women managers to have , the KOPEPI Ketiara Cooperative Among agricultural commodities, coffee all members working together in support cultivates coffee at elevations between is Indonesia's fourth-largest foreign of coffee production has enabled Ketiara 900 and 1700 meters above sea level. exchange earner after palm oil, rubber, to expand and become a major player as and cocoa. The area's soil is suitable for the a coffee exporter to US, Europe, Japan, production of Arabica coffee and these Australia, and Asia Coffee was introduced to the archipelago have grown in the region since by the Dutch who initially planted coffee 1908 and are now recognized globally for trees around their stronghold of Batavia their rich flavor and strong body. The but quickly expanded to Bogor and cooperative uses the wet-hulled or semi- Sukabumi regions in West Java in the washed processing method and applies 17th and 18th century. Indonesia proved Good Agricultural Practices (GAP). to have a nearly ideal climate for coffee production; hence plantations were soon The Koperasi Pedagang Kopi Ketiara is a established in other parts of Java and on women-run cooperative with over 890 the islands of Sumatra and Sulawesi. grower-members who cultivate coffee on more than 830 hectares of land. The

Today, Indonesia's coffee plantations cooperative produces 100% shade-grown Photo: Chairwoman, Ibu Rahmah picking cover a total area of approximately 1.24 Arabica coffee. Member farmers are Coffee with other women. million hectares, 933 hectares of Robusta located around the Lut Tawar Lake in the plantations and 307 hectares of Arabica Gayo Highlands in the district of plantations. More than 90 percent of Takengon and Bener Meriah, Central total plantations are cultivated by small- Aceh. The area is a mountainous, tropical scale growers. forest within the Leuser Ecosystem.

Indonesian Coffee Production & Export: 2008 2009 2010 2011 2012 2013 2014 2015 2016¹ Production 698,016 682,690 686,921 633,991 748,109 740,000 711,513 550,000 650,000 (in tons) Export 491,335 518,122 440,241 353,698 520,275 460,000 382,774 350,000 400,000 (in tons) Export 1.08 0.88 0.86 1.09 1.53 n.a. 1.03 1.19 1.36 (in bln USD) ¹ indicates forecast Source: Asosiasi Eksportir dan Industri Kopi Indonesia (AEKI)

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“A VIBRANT INDONESIA”

Highlight the modern and advance Indonesia while keeping its richness of arts and cultures

VISITORS EXHIBITORS PROFILE PROFILE  Chambers of Commerce in Midwest  Indonesian Ministry/Agency  Industrial and Trade Business owners in the  Provincial Government Midwest  City Government  Local and international community in Chicago  District Government and in the Midwest  Entrepreneurs  Potential Buyers and Investors  Indonesian diasporas  Local officers  Industries sector: Travel, Tourism, Arts, Textile,  Consular Corps in Chicago Apparel, Fashion, Food and Beverage, Services  ±2.000 visitors (free for public) and other products.

PROGRAM 1. Exhibition of trade products, investment opportunities, arts, cultures and tourism destinations in Indonesia 2. One-on-one meeting 3. Workshop “Market Access to the Fishery and Maritime Sector of Indonesia – USA” 4. Business Meeting “Region Potency and market access to the USA” 5. Indonesian Art and Culture Performance 6. Cooking demo 7. Fashion show 8. Food and coffee/tea testing 9. Photos exhibition and Indonesian films promotion

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Source: International Coffee Organization

Gate to American and European Markets

By: Lisa Yuliana, Vahd N. Mulachela

Global inquiries for organic products increase every year. More and more people realize how important healthy foods are for their wellbeing. Making a commitment to healthy eating is a great start towards a healthier life. But to guarantee the authenticity of organic products, certification becomes an imperative and inevitable requirement. In Indonesia, efforts to ensure the genuineness of organic products are conducted by professional certification agencies.

Organic products available in the market A high demand for organic products Like many other countries, Indonesia are getting more varied and diverse. requires a high and secure control Cafes and restaurants selling organic mechanism to protect consumers from experienced a significant expansion of the products are increasingly popular and threats of counterfeit products that could domestic market for organic products. booming. People seem to understand the be harmful to health and the This phenomenon occurred benefit of consuming organic products. environment. This necessity led to the simultaneously with the growing Along with this trend, the need for creation of a credible certification awareness of the local public towards safeguarding the authenticity of organic mechanism compatible with regional and healthy and ‘back to nature’ lifestyle. products becomes essential. international standards.

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To have a standardized certification gives a set of benefits including wider access for organic products into international markets, a higher degree of consumer protection, and broader access to premium markets. Nowadays, through participating in organic and sustainable agriculture programs, producers could gain multiple advantages.

Overview of Global Market As stated earlier, organic products saw plausible demand increase not only in Indonesia. The rise of queries for organic products reflects the increase of their sales in a global scale. In 2014, the sales of organic products with estimated value market was the United States (comprising area of 88,247 hectares (0.16% of the of USD80 billion were generated from of approx. 43 percent of the global world total). 43.7 million hectares of organic market), followed by the European Union plantations throughout the world. Fifteen (23.9 billion Euros/38 percent) and China years earlier, in 1999, organic market size BIOCert Indonesia: Toward Global (3.7 billion Euros/6 percent). (Source: was valued around USD15.2 billion. The Organic Product Market Research Institute of Organic Agriculture combined area of an organic farm in the Indonesia has 19 organic products (FiBL-IFOAM survey 2016). world was approximately 11 million certification agencies operating in the hectares. In 2014, the countries with the country. While 8 of them are locally According to the FIBL’s 2016 survey, largest market for organic food were the based agencies, the rest are international Indonesia in 2014 ranked as the country United States (27.1 billion Euros), organizations specializing in certificating with the 8th highest increase of organic Germany (7.9 billion Euros) and France organic products for export. agricultural area (47,950 hectares). That (4.8 billion Euros). But the largest surge contributed to Indonesia’s total distribution of retail sales by single (Source: Indonesia Invites)

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Manado International Conference on Tourism Investment Bring Tropical Indonesia Closer to the China and East Asia Tourism Markets

Creating a sustainable platform for tourism development

Manado International Conference on Tourism Investment is hosted by BKPM, Ministry of the Tourism of the Republic of Indonesia together with Government of North Sulawesi Province, and will be opened by the President of Indonesia.

Registration May 23 - 24, 2017 [email protected] at Sintesa Peninsula Hotel, Manado, North Sulawesi – www.manadoinvestmentforum.com Indonesia Phone: +62 21 525 2008 Fax: +62 21 520 2050 Trade Expo Indonesia Indonesia's largest Business to Business trade event showcasing the best of Indonesia The largest archipelago in the world export products

For more info contact: Economics Affairs - Consulate General of the Republic of Indonesia in Chicago 211 W. Wacker Drive #8, Chicago, Illinois 60606 Phone: 312.920.1880 Fax: 312.920.1881 Email: [email protected] www.tradexpoindonesia.com

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